According to RateSetter Australia’s chief executive Daniel Foggo, the recent upturn is due to the low interest rates being offered by Australian banks, which has seen millions of dollars withdrawn from retail bank accounts and moved into peer-to-peer platforms.

“About 60 per cent of the funds that have come onto our platform have come out of bank accounts,” he told the Sydney Morning Herald. “We expect to hopefully double the number of investors on our platform in the next six months.”

An internal survey of RateSetter Australia’s investors found that around AUS$45m has been taken out of bank accounts and lent directly to borrowers, mainly in the form of personal loans and small business loans. It is offering annual rates of approximately 3.5 per cent on a one-month loan, 5.2 per cent on a one-year loan, 8.3 per cent on a three-year loan and up to 9.5 per cent over five years. By comparison, the Reserve Bank of Australia’s base rate is currently 1.5 per cent, and most Australian bank accounts are offering savings rates well below three per cent.

However, despite the recent surge of investors, RateSetter’s Australian platform is still unprofitable.

Foggo said that he expects the company to break even over the next 12 to 18 months and suggested that the firm may consider a listing on the Australian Stock Exchange (ASX) once it starts turning a profit.